Ready to get your first budget after college all setup? If you’re like me, I knew that after college graduation, I needed to get my finances in check.
With student loans kicking in soon and a bigger paycheck, it’s not only important to make your finances a priority but to set up the right habits. One of the best things you can do for yourself is set up your first budget after college is done.
It’s not easy to try to manage money when there’s no game plan.
And that’s life after college. It seems like there are so many options, so many different paths to take, that a lot of us fail to take any of them and the rest of us just feel anxious that we might not choose the right one.
But whatever path you take, we all have to set up our first budget after college.
Related article: 12 Steps You Need To Take After You Graduate College – Part 1
Here are the steps to setting up your first budget after college and making sure that the first real paycheck goes to work for you. The worst thing you could do is look back at your life and wonder where all that money has gone.
So let’s get started…
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Prioritize
Intentionality is the key to becoming successful. I mention it in almost all my posts and that’s because it is an anthem in my life.
If you are intentional, habits will change. Your life will become different and become the life you want if you put in the work and bring intentionality to the table. Don’t make a decision if you are not going to be intentional about it.
So the first step to getting your first budget after college in place is to become intentional about it. Are you going to make it a priority in your life?
Being intentional about your finances means making it a priority in your life. And making it a priority begins with changing your mindset.
You have to believe that you can save, invest, and manage money well. You have to understand what control money has on your life right now and what control you are willing to give it.
But there’s also one other thing you have to be aware of when it comes to mindset…
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Do you feel in the dark? I know I did after I graduated college! Here's everything you need to know to start your SUCCESSFUL adult life!
Keep a Poor Mindset
A poor mindset? That’s right. The mindset that you don’t have a lot of money.
In college, you were probably just scraping by. You weren’t bringing in a significant income yet, you knew you needed books, school supplies, and let’s be real, those fun nights out with your friends.
However, you also knew that you were poor. You knew your limit. One of the best things you can do for yourself is to keep that mindset going after you graduate.
Check out my favorite book on money here!
Sure, your paycheck will grow and you won’t feel as poor but if you can trick yourself into believing that you really don’t have a lot of money, then you will find your spending habits remain the same and see more money in the bank.
Here’s an example of how I do this. As soon as my paycheck comes in every other week I disperse the money so I don’t even see it. First I tithe a portion to my church, then I pay rent and any other bills, and put some of it towards my credit card to pay off whatever is on there. Then the rest goes to my loans and I save a bit for groceries and gas.
All of a sudden, my paycheck is gone and I am in a poor mindset. I plan to do this until I have paid off all my debt. After that, I will increase my personal, retirement, and investment savings so that the money goes there before I even see it.
Keeping a poor mindset means keeping the cost of living low. And I truly believe that is the key to paying off debt faster, saving more, and building your retirement funds.
There is really no reason to increase your cost of living when a bigger paycheck comes in. Keep driving the crappy car and paying for the tiny apartment. Once your money is managed well that way and you have been handling it wisely, then you can increase your cost of living.
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Set Up A System
Now comes the fun part where you will set up a system for your first budget after college. How would you like to actually keep track of your money? This can be done in an excel sheet, on an app, or in your own notebook.
Really think about convenience here, because you are only going to want to budget if it is convenient at the time. So, if you rarely open your laptop since college is done then don’t do an excel sheet on your laptop.
Here are my favorite apps to use to set up your budget super easy and accessible from your phone at any time: Mint, Every Dollar, and Pocket Guard.
I have used a mixture of these over the years and each one has slightly different benefits, so check them all out and see which is best for you.
Before I start putting it into the app though, I like to look at it all on paper. I first write down all my income sources and the amount and what time of the month they come in.
Then I write down all my expenses. After that, I will add totals up and see how much is being spent in each category.
As a general rule of thumb, it is recommended that 50% of your income goes towards essentials (rent, car insurance, gas, utilities, food, tithe), 30% towards lifestyle choices (eating out/coffee, entertainment, random purchases), and 20% towards financial priorities (savings, IRA, loans).
However, if you are paying off debt or saving towards a big goal these can certainly be altered.
Set Goals
Before you start to begin tracking every month it is important to set some sort of goal. Like being intentional with your money to make change happen you also need to set a goal.
Your first budget after college will be successful when you decide on something to work towards and set a deadline.
If you’re not sure what goal to set first I highly recommend following Dave Ramsey’s Baby Steps and checking out his book.
After I had an emergency fund in place my first goal was to pay off all my debt. The debt snowball is a good place to start for most people. Getting out of debt leads to a great deal of freedom and frees you up for other saving goals and even earlier retirement.
So choose a goal with a deadline to get started and begin mapping out what you will spend in each category.
Your first budget after college might involve a lot of cutting expenses so let’s take a look at easy ways to do just that next.
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Cut Out The Easy Things
While it’s not glamorous to say no to parties are find a free form of entertainment, it is often the wisest. Being a 20-something grandma means being wise and using our money diligently.
One of the easiest ways I have saved so much money is by always bringing my own lunch to work and never purchasing snacks. Living healthy is often living cheaper.
This was a mindset change that took a little while for me to get used to but often, when you are overweight you are spending more money on food than you realize. All those quick stops and cheap food add up. Not to mention all the doctors’ bills that will come your way in the future.
Eating healthy may seem like more money at first, but it is cheaper in the long run. Taking care of your body now means fewer aches and pains in the future and less snacking, which adds up very quickly.
Related Post: Get Healthy Today – 5 Simple Steps You Can Take Right Now
Also, decide to get into the mindset of no impulse buys. I regularly avoid going inside a store, even for groceries, if I am trying to save money. I always impulse buy walking down the grocery store lines, and whatever I am craving ends up in my cart…oops!
Here’s a trick for you, go onto the Walmart app, or whatever grocery store you use, add only the items you need to your cart, see the total and adjust till it’s in your budget and checkout for pickup.
This is one of the easiest and simplest ways to save money on groceries.
Another way to cut costs is by saving money on hair and nails. Decide to go without the best nails for a while and maybe skip a haircut and let it grow out a bit before another cut. This is a luxury expense we often make into a necessary one. It’s an easy one to cut out and it’s justifiable on a few levels.
Lastly, don’t make alcohol a lifestyle. Yes, alcohol is great but it’s also crazy expensive. So consider limiting it and you’ll find yourself saving money.
Your first budget after college doesn’t have to be extremely restricting but it does have to serve a purpose.
The Ultimate Guide To #Adulting
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Do you feel in the dark? I know I did after I graduated college! Here's everything you need to know to start your SUCCESSFUL adult life!
Money Saving Apps
Some of the best advice I can get you about setting up your first budget after college is to download the Debitize app.
This app has changed everything for me. In a nutshell, it takes your credit card and turns it into a debit card. Basically, each day it takes out from your checking account the amount you spent on your credit card and holds it in a reserve account, and then pays your credit card off for you, either weekly or monthly, whichever you choose.
I love this app because it has helped me never overspend on a credit card. It also helps me keep track of how much money is in each of my accounts and I never overspend.
You can download Debitize here and receive $10!!
Related Post: How To Manage Your First Real Paycheck After College
Track Everything & Every Amount
Now that you have goals and systems in place, it’s time to track everything. Pick a weekly or monthly date when you will input all your transactions and manage your budget.
Then review where you overspent, underspent, and adjust.
Your budget is something that is liquid and can adjust over time. You should keep the mindset of holding it but as life changes happen you also may need to adjust.
I love Mint because it emails me as soon as I overspend in a certain category or go beyond my budget. This can allow me to pull from other categories to cover that one for the month and still keep the other categories in check.
If you have a spouse, this is also an important time to review the categories together and fix your game plan so that you are able to stay on track to reaching your goals.
It’s so easy to want fast solutions and easy answers, but with money and most things in life, it takes time. Nothing changes overnight so it’s important to really focus on nurturing new habits.
Check out my favorite book on money here!
If you are someone who tends to struggle with this then get an accountability partner. Email them your budget weekly and have them review it with you. They have permission to identify purchases that were not necessary and tell you how to get back on track.
Become intentional about holding to your budget that you turn down things and say no in your head often. It’s not easy but if you make it a priority in your life then it will become slightly easier.
Learn What Being Rich Is
As a 20-something, I was never taught what it meant to be rich in school. There was no class that gave me a game plan to conquer my money or walked me through the steps of setting up my first budget after college. However, that gave me the opportunity to educate myself.
The best thing you can do for yourself at this stage of life is to educate yourself. Your first budget after college is not easy, but if you do some research, like you are right now, keep reading finance blogs and books, and focus on learning everything you can, then you will be ready to conquer your budget in no time.
Discover what being rich means to you. Is it owning a lot of things, or is it living in financial freedom with the ability to give back? The choice is yours.
Never stop learning. Never stop teaching. What’s the biggest takeaway from your first budget after college?
The Ultimate Guide To #Adulting
Because #ADULTING.
Do you feel in the dark? I know I did after I graduated college! Here's everything you need to know to start your SUCCESSFUL adult life!
Kelsey at GoodPointGrandma
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[…] Related Article: How To Create Your First Successful Budget After College […]
Budgeting is SO important and something I wish I would’ve learned sooner! These are some great tips and would be so helpful for a student fresh out of college. I did not realize the true value and weight of money until I was out of school and responsible for so much.
I totally agree Courtney! Super super important!
Great suggestions!! These are fabulous for anyone just graduating!
Thank you Kelly!
Being intentional is so important! Establishing healthy financial habits early is such a wonderful thing to do and will be so beneficial in the long run!
Couldn’t have said it better myself!
These are great tips for people of all ages! I know I constantly need budget tips and advice! Like you, Mint has been a great resource I’ve utilized to learn where I’m spending money each month!
I love Mint! Thanks for commenting Monica!
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[…] Related Post: How To Create Your First Successful Budget After College […]
[…] Related Post: How To Create Your First Successful Budget After College […]
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